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Study Resources (Accounting)

41) Using the physical measures method, the weightings for joint cost allocations for Jarlon and Kharton respectively are: A) 27.62% and 72.38% B) 80.00% and 20.00% C) 39.58% and 60.42% D) 72.38% and 27.62% E) 60.42% and 39.58% 42) Using the sales value at split off method, the joint costs allocated to Jarlon would be: A) $289,520 B).
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17) Trundle Ltd. produces 2 main products, J and K, and a by-product, L.  There were no beginning inventories. During April, it incurred $275,000 of joint costs, which are allocated to main products using the physical output method. Additional information follows: UnitsUnitsUnit Sales ProductProducedSoldPrice J              12,000              9,600              $22 K              18,000              15,300              38 L              6,000              5,200             .
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16.5   Analyze relevant profitability data and decide whether to drop or add customers or branches. 1) Managers find customer-profitability analysis useful because it frequently highlights how vital a small set of customers is to total profitability. 2) Revenue shedding refers to the strategy of providing price discounts on a long-term basis to.
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9) A favorable sales-mix variance arises when the actual sales-mix percentage is less than the budgeted sales-mix percentage. 10) A composite unit is a hypothetical unit with weights based on the mix of individual units. 11) The sales-mix variance can be explained in terms of the budgeted contribution margin per.
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54) Bob's Appliances manufactures industrial dryers and washers. During February the following data are available: DryersWashers Actual units sold10,00040,000 Budgeted sales 8,82033,180 Actual selling price $700$900 Budgeted selling price $710$930 Budgeted market share 25%24% Actual market share 20%25% Budget cont. margin /unit $275$375 Required: Determine the following: 1.Sales-mix and sales-quantity variances 2.Market-share and market-size variances (for calculation purposes round.
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39) When the actual mix of products sold shifts in favour of the high-contribution-margin product, A) the total sales-mix variance is unfavourable. B) the total sales-mix variance is favourable. C) the total sales-volume variance is unfavourable. D) the total sales-volume variance is favourable. E) the total sales volume is more favourable (or less unfavourable). 40) A.
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31) In rate regulation settings, which method is usually preferred over the sales value method? A) constant gross-margin percentage NRV method B) estimated net-realizable method C) physical measure method D) sales value at split off method E) rate regulation method 32) Advantages of the sales value at split off method include all of the following EXCEPT A).
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14.4   Evaluate and select among three cost allocation methods for a product-sustaining inventoriable period cost and a facilities-sustaining period cost. 1) The direct allocation method ignores any services rendered between support departments. 2) The step-down allocation method allows partial recognition of services rendered by support departments to other support departments. 3) The reciprocal.
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19) Which of the following is not a sales related variance? A) sales volume variance B) sales quantity variance C) market size variance D) direct materials yield variance E) market share variance 20) The sales-volume variance plus or minus the static budget amount results in A) the fixed-budget amount. B) the flexible-budget amount. C) an unfavourable/favourable variance. D) the variable-budget.
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31) The incremental benefit or (loss) of processing Kharton into Kraxton is: A) $74,000 B) $22,000 C) ($22,000) D) ($96,000) E) $170,000 32) Green Paper Company processes wood pulp into two products. During January the joint costs of processing were $144,000. Production and sales value information for the month were as follows: Sales Value at Product    Kilograms Produced   Split.
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39) Why would businesses want to sell bundled products? What benefits, if any, are there for the consumer? 40) Describe and discuss the two methods of allocating the revenues of a bundled package to the individual products in that package. Describe any special problems associated with the method. 41) Under the stand-alone.
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22) Van Meter Company has substantial fluctuations in its production costs because of the seasonality of figs. Most fig growers have two crops a year, one in June and one in August. However, the company has been importing figs from southern hemisphere countries, which extends the supply to the months.
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11) How much of the cost of the Personnel Department is allocated to Department A using the direct method? A) $5,000 B) $15,000 C) $13,333 D) $12,632 E) $48,000 12) What is the cost of the Maintenance Department allocated to Department B using the step-down method if the support department with the highest percentage of interdepartmental.
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53) CSI Chemical, Inc. processes pine rosin into three products; turpentine, paint thinner, and spot remover. During May the joint costs of processing were $240,000. Production and sales value information for the month were as follows: Product       Units Produced   Sales Value at Split off Point Turpentine3,000 litres$30,000 Paint thinner3,000 litres25,000 Wood alcohol1,500 litres12,500 Required: Determine the amount of.
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29) Fresh Bread Company sells a special mix of wheat bread. If the expected output equals the actual output, the sales-volume variance A) will be negative. B) will be positive. C) will be favourable. D) will be unfavourable. E) will be zero. 30) The difference between (the budgeted contribution margin for the budgeted sales mix and.
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  15.1   Distinguish among different types of saleable products, scrap and toxic waste. 1) Joint costs are incurred beyond the split off point and are assignable to individual products. 2) A byproduct has a minimal sales value. 3) Scrap frequently has a zero sales value. 4) There are no logical reasons for allocating joint costs. 5).
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15) Distinguish between the two principal methods of accounting for byproducts, the production byproduct method and the sale byproduct method. Briefly discuss the relative merits (or lack thereof) of each. 16) Trundle Ltd. produces 2 main products, J and K, and a by-product, L. There were no beginning inventories. During.
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57) The Omega Corporation manufactures two types of vacuum cleaners, the ZENITH for commercial building use and the House-Helper for residences. Budgeted and actual operating data for the year are as follows: Static Budget          ZENITH    House-Helper        Total Number sold15,00060,00075,000 Contribution margin$3,750,000$12,000,000$15,750,000 Actual Results         ZENITH    House-Helper        Total Number sold16,50038,50055,000 Contribution margin$6,200,000$10,200,000$16,400,000 Prior to the beginning of the year, a consulting firm estimated the total.
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11) The estimated net realizable method allocates joint costs on the basis of A) expected final sales value less separable costs of production and marketing. B) value added after the split off point. C) sales value less value added after the split off point. D) revenue less all direct manufacturing costs after split off.
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15.3   Evaluate two different market-based cost allocation methods to identify which is most appropriate to decide whether to sell at splitoff or process further. 1) The method of allocating joint product costs is an important guide for other management decisions. 2) The estimated net realizable value method allocates joint costs on the.
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35) Red Sauce Canning Company processes tomatoes into catsup, tomato juice, and canned tomatoes. During the summer the joint costs of processing the tomatoes were $420,000. There was no beginning or ending inventories for the summer. Production and sales value information for the summer were as follows: Sales Value at Product    Cases    Split off.
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15.4   Identify the strategic implications of a decision to implement one joint cost allocation method. 1) Different joint cost allocation methods will result in different product margin percentages for the individual products. 2) If managers make processing or selling decisions using incremental revenue / incremental cost approach, which of the following statements.
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  Use the information below to answer the following question(s). Chem Manufacturing Company processes direct materials up to the split off point, where two products (X and Y) are obtained and sold. The following information was collected for the month of November. Direct materials processed: 10,000 litres (10,000 litres yield 9,500 litres of good.
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31) Seacrest Corp. allocates support department overhead costs to operating departments X and Y by means of the reciprocal allocation method. Information for the current month is as follows: Support Departments A B Overhead Costs$20,000$10,000 Services provided to departments: A-10% B20% - X40%30% Y40%60% 100%100% Required: Provide the linear equation to be used in the allocation of A's costs: The equation.
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  16.1   Select a method and allocate revenue from a product bundle to its distinct components. 1) Revenue allocation occurs where revenues can be identified with an individual product (service, customer, and so on) in an economically feasible (cost-effective) way. 2) Revenue tracing results in a more accurate assignment of revenues to products,.
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38) Juno Ltd. manufactures three separate products Q, R, and S from a joint production process . During March, the joint costs of processing were $875,000. Production and sales value information for the month were as follows: Product Units Produced Final Sales Value per Unit Separable Costs Q 42,000 $18 $190,000 R 68,000 32 720,000 S 35,000 26 210,000 Required: Determine the amount.
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52) The Chair Company manufactures two modular types of chairs; one for the residential (home) market, and the other for the office market. Budgeted and actual operating data for the past year are: Static BudgetActual Results Home OfficeHomeOffice Number of chairs sold 260,000140,000248,400165,600 Contribution margin$26,000,000 $11,200,000 $22,356,000$13,248,000 The industry volume for residential and office.
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21) Which of the following is a valid conclusion, in comparing the three allocation methods? A) The reciprocal method is conceptually inferior. B) The direct method is viewed as too complex by most organizations. C) The step-down method is viewed as too complex by most organizations. D) Many managers find the step-down method too.
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31) Using the stand-alone method with manufacturing cost per unit as the weight for revenue allocation, what amount will be allocated to the refrigerator? A) $500.00 B) $612.50 C) $620.00 D) $775.00 E) $687.50 32) Using the stand-alone method with physical units as the weight for revenue allocation, what amount will.
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11) The stand-alone revenue allocation method is a weighted average method. 12) The incremental revenue-allocation method uses product-specific information pertaining to products in the bundle to determine the weights used to allocate the bundled revenues to those individual products. 13) The first-ranked product is termed the incremental product in the incremental.
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11) The cost of visiting customers would MOST likely be classified as a A) customer output unit-level cost. B) customer batch-level cost. C) customer-sustaining cost. D) corporate-sustaining cost. E) distribution-channel cost. 12) Costs incurred to handle each unit sold would MOST likely be classified as a A) customer output unit-level cost..
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20) List at least three different levels of costs in a customer-cost hierarchy and an example of each. 16.3   Calculate and interpret four levels of revenue variance analyses. 1) The static-budget variance for revenues is the difference between the actual revenues and the budgeted revenues from the static budget. 2) The sales-mix.
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15.2   Analyze the physical measure and sales value at splitoff methods to allocate joint costs. 1) The cause-and-effect criterion is not present when joint costing is used. 2) It is easier to cost inventory if the joint products are sold before the split off point without further processing. 3) The sales value.
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21) Calculate the allocation of packaged price Game A in Package 3, using selling prices as the base. A) $34.20 B) $30.00 C) $25.00 D) $22.80 E) $19.00 22) Calculate the revenue allocation for Game A in Package 1, using physical units as the base. A) $12.57 B) $13.97 C) $20.84 D) $22.00 E) $23.16 23) Calculate the allocation of packaged price.
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  17.1   Distinguish process- from job-costing allocation methods within the decision framework, and apply the weighted-average method of inventory valuation when the beginning work-in-process inventory is zero. 1) The primary difference between job costing and process costing is the extent of averaging used to compute unit costs of products or services. 2) The.
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16.4   Generate a customer profitability profile. 1) Customer-profitability analysis examines how individual customers, or groupings of customers, differ in their profitability. 2) Customer-specific costs are costs that are traceable or allocated to individual customers. 3) ________ examine(s) how customers differ in their profitability. A) Customer-profitability analysis B) Customer revenue analysis C) Customer-cost hierarchy D) Price discounting E) Customer-price.
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36) Software For You encounters revenue-allocation decisions with its bundled product sales. Here, two or more units of the software are sold as a single package. Managers at Software For You are keenly interested in individual product-profitability figures. Information pertaining to its three bundled products and the stand-alone selling prices.
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25) For each of the following items tell whether it is a main product, joint product, byproduct, or scrap. Assume traditional situations. a.Bones from a butcher shop b.Sawdust from a sawmill c.Sawdust from a furniture manufacturer d.Fuel oil from petroleum processing e.Salt from a salt works process f. Broth from cooking food g.Raw milk for dairy processing h.Skim.
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50) CSI Chemical, Inc. processes pine rosin into three products; turpentine, paint thinner, and spot remover. During May the joint costs of processing were $240,000. Production and sales value information for the month were as follows: Product       Units Produced   Sales Value at Split off Point Turpentine3,000 litres$30,000 Paint thinner3,000 litres25,000 Wood alcohol1,500 litres12,500 Required: Determine the amount of.
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  Use the information below to answer the following question(s). Troy Company processes 15,000 litres of direct materials to produce two products, Product X and Product Y. Product X, a byproduct, sells for $4 per litre, and Product Y, the main product, sells for $50 per litre. The following information is for.
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